When a firm's inventory falls to a predetermined level,a new order is placed to replenish inventory.This predetermined level is known as ______.
A)the reorder point
B)the replenishment point
C)the stock-out point
D)the safety stock point

Question

Quizplus · Accepted Answer

The predetermined level at which a new order is placed to replenish inventory is called the reorder point. This helps ensure that inventory levels do not fall below a certain point and helps maintain smoother operations by avoiding stockouts. Option B, the replenishment point, is not a commonly used term in inventory management. Option C, the stock-out point, refers to the point at which inventory has been depleted and is out of stock. Option D, the safety stock point, is the level of inventory kept on hand to account for uncertainties in demand or supply.

When a Firm's Inventory Falls to a Predetermined Level,a New